MrTact, Lead Server Programmer for UO, has posted an update on the progress being made with the upcoming character transfer service.  (If you are unfamiliar with this development, you can read about it here).  Here's a quick snippet:

There has been some question as to why we are "wasting" a publish by doing character transfer. The answer is, "housing phase 3." That is to say, we wish to avoid another sword of Damocles hanging over our heads for a year. We are committed to delivering this service, so we want to focus our efforts on completing it, make sure it is as polished as we can make it, and then move beyond it to resume our regular schedule of bug fixes & new content.

The official Ultima Online website may be accessed here.